Vice-President Siim Kallas, in charge of transport, announced today a breakthrough in the EU-Brazil negotiations on an ambitious aviation agreement. Negotiators from the EU and Brazil have initialled a comprehensive agreement on air transport services. This is a significant development in the context of the Strategic Partnership between the EU and Brazil launched in 2007. Brazil is by far the largest air transport market in South America with annually around 4.5 million passengers carried on flights between the EU and Brazil. Brazil is also among the fastest growing aviation markets in the world. In 2010, the Brazilian air transport market grew by 23% compared to 2009.The new agreement will be a major step in the opening of markets. It creates new investment opportunities and improves the commercial and operational environment for EU carriers operating into Brazil.

Vice-President Siim Kallas said: "What we have reached with Brazil today is an agreement that will open up the air traffic market between the EU and Brazil. This will generate significant economic benefits for businesses, travellers, the aviation industry and the wider EU and Brazilian economies.I am also very pleased with the strong provisions included in the agreement that will make it easier for our carriers to operate in Brazil. This is particularly important in view of the very important world sports events that Brazil will be hosting in the coming years."

The key points of the agreement:

All EU airlines will be able to freely operate direct flights to anywhere in Brazil from anywhere in Europe as the agreement will remove all restrictions on routes, prices, and the number of weekly flights between Brazil and the EU.

New business opportunities will be created for European cargo operators flying to Brazil and beyond.

Improved flexibility by reducing administrative burdens on airlines makes it easier to do business in Brazil - to the benefit and convenience of passengers.

Both sides have agreed to closely cooperate in a wide range of areas including safety, security, application of competition law, air traffic management, environment, consumer protection and social and labour issues. This will ensure a level playing field for fair competition between EU and Brazilian airlines.

The agreement builds on the success of the European internal aviation market. It is an important step towards the normalisation of the international aviation industry as it gradually removes outdated restrictions on prices, traffic rights and facilitates the cooperation between the authorities, including in international bodies.

The new EU-Brazil agreement comes at a strategic moment considering that Brazil will host the FIFA World Cup in 2014 and the Olympic Games in 2016.

According to an economic impact assessment study, full market opening with Brazil could generate up to €460 million in consumer benefits a year. The potential for traffic growth is estimated at 335,000 additional passengers in the first year.

The EU has already comprehensive air transport agreements in effect with the United States, Canada, Switzerland, Morocco, the Western Balkan countries, Georgia and Jordan.